Drop in bonuses blamed on pensions

MONEY FOR NOTHING While the average annual bonus this year will be less than a month and a half's salary, traditional manufacturers are promising some serious payouts

By Jessie Ho / STAFF REPORTER

Local businesses are to award an average of 1.48 months' salary as year-end bonuses to their employees this year, about one-third of a month's salary less than last year, mainly because of extra costs incurred from the new pension fund rule, according to a survey released by 1111 Job Bank (1111人力銀行) yesterday.

"The slight drop in year-end bonuses this year has to do with the weaker economy last year compared with 2004," Ryan Wu (吳睿穎), spokesman for 1111 Job Bank, told a press conference yesterday.

"But the new pension fund measure, which added to employers expenditure, has especially affected their willingness to award bigger bonuses," Wu said.

Under the new law, companies in Taiwan are required to set aside 6 percent of an employee's salary every month toward their pension fund.

About 5 percent of companies polled said that instead of year-end bonuses, they would offer a small amount of cash in a traditional Lunar New Year red envelope, gift coupons or a free outing for employees.

However, people who work for foreign companies in Taiwan can look forward to an average year-end bonus of 3.07 months' salary, the survey showed.

The traditional manufacturing sector, which enjoyed a bumper year on the back of soaring prices and demand for raw materials, offers the highest bonuses this year.